Research On The Procedure Of "Zombie Enterprise"

Commercial subjects are "persons" stipulated by law. When they lose their ability to make profits and their stored value is continuously eroded to fall into an economic stagnation,they become the so-called "zombie enterprises". These "zombie enterprises" should go bankrupt, but they are not, and rely on social public resources for long-term survival.Macroscopically, these enterprises are stuck in economic sluggishness. Deceived by an independent responsibility system, the trading partners are actually in a high-risky trading environment. This is a serious violation of the basic principle of safety in commercial activities.In terms of legislation,some scholars think that many enterprises have made use of the legal person independent responsibility system and go bankrupt to avoid their legal liabilities.However, the actual situations are contrary to the theoretical assumption. When an enterprise is in a helpless condition,it still attempts to recovery its economy through continuous trading.As a result, breach of contract happens frequently, which actually increases enterprise debts and deepen their operation stagnation. Meanwhile, these enterprises lack solvency. Along with accumulation of new debts,these enterprises,being in an "actually bankrupt" status,are faced with a series of valid legal instruments. Consequently,many "zombie cases" are caused. For a long time, enterprises have been known as basic elements to push forward market-oriented economy.However, when these enterprises should go bankruptcy but not and keep on consuming the limited social resources,it will undoubtedly curb sound development of the economy.This paper first focuses on analyzing based on the economic concept of "zombie enterprises",and then introduces the definition of "zombie enterprises" in the broad sense and their judgment standards. After that, causes of their economic stagnation are examined. Based on that, the agreement between bankruptcy implementation system and the withdrawal system of "zombie enterprises" as well as the unavoidability of the withdrawal system of "zombie enterprises" under the impact of bankruptcy implementation system is pointed out.Meanwhile,legislation purpose of the current bankruptcy implementation system and the actual compulsory enforcement results are studied,finding out that the withdrawal path of"zombie enterprises" is inevitable and has its own defects. To sum up, in this paper, the author first introduces the "inquisitorial" bankruptcy system based on characteristics of "zombie enterprises" and the "semi-inquisitorial system" of bankruptcy implementation system.Then, by referring to the compulsory bankruptcy system abroad and combining comparative analysis, the author attempts to build the "inquisitorial' bankruptcy implementation system for the executive court concerning "zombie enterprises" under the"actually bankrupt" status. Besides,this paper also explores the defects of the bankruptcy model of "zombie enterprises" in the special executive stages. First, in terms of whether the bankruptcy causes are justified, the judgment of the executive judge in launching the bankruptcy procedures has some flaws compared with the debtor's application for bankruptcy and the creditor's application for bankruptcy. Second, the launch of the bankruptcy procedures has deprived the right of choice between the bankruptcy reorganization and bankruptcy compromise,so it is improper to directly put the insolvent enterprises to a "death sentence" rashly when the bankruptcy implementation conditions are not yet operable.Therefore,a relief mechanism should be established for the "inquisitorial" bankruptcy implementation. Third,concerning special economic nature of "zombie enterprises" and bankruptcy launch period, the bankruptcy systems, such as the right of bankruptcy revocation,should be adjusted. All in all, this paper explores the necessity of bankruptcy implementation based on the legislation status of bankruptcy implementation and the withdrawal mechanism of "zombie enterprises". Meanwhile, concerning challenges facing the bankruptcy implementation system, the author attempts to make some improvements.